XRP Ledger proposes AMM Swappable Curves upgrade

Developers have proposed a significant upgrade to the XRP Ledger's decentralized exchange that would expand the functionality of its automated market maker. A draft amendment titled "AMM Swappable Curves" was submitted to the ledger's standards repository on May 26, authored by core developers Denis Angell and Roman Thpt. The proposal aims to introduce new pricing models for liquidity pools, moving beyond the current single-option system.

The existing automated market maker, activated on the network in March 2024, operates on a constant product model. This design spreads liquidity uniformly across all possible price ranges, which can be inefficient for assets that trade within narrow bands, such as stablecoins or correlated token pairs. The new draft would allow creators of new liquidity pools to select a specific pricing curve when establishing their pool.

Two new curve types are specified in the proposal: Concentrated Liquidity and StableSwap. Concentrated Liquidity enables providers to deposit funds within a specific price range, increasing market depth around active trading zones and reducing idle capital. StableSwap is designed for assets that trade near a one-to-one ratio,...